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Section 35 (Right to Apply to Vary a lease)

Summary

1. This section gives any party to Long Lease (Leaseholder or Landlord or ‘Manager’ in a tripartite lease) the right to apply to a First Tier Tribunal for the terms of the Lease to be varied.

2. There are no restrictions on what type of variation may be requested, although Section 35 includes a list of reasons (‘Grounds’) why an application may be made.

Grounds for an Application under Section 35

1. An application to vary a lease under Section 35 may be made on the basis that the Lease fails to make ‘satisfactory provision’ for any of the following:

i. Repair or maintenance of the flat, building or estate.

ii. Insurance cover.

iii. Repair or maintenance of installations serving the property.

iv. Provision of services.

v. Recovery of expenditure by either Landlord or Leaseholder.

vi. Computation of the Service charge.

2. The only one of these items for which Section 35 provides a definition of what constitutes unsatisfactory provision is ‘Computation of the Service Charge’.

Computation of the Service Charge

1. Section 35 states that a Lease fails to make satisfactory provision for Computation of a Service Charge if:

i. The Lease states that a leaseholder or tenant must pay a proportion of expenditure by a Landlord or Superior Landlord.

And

ii. Other tenants or leaseholders of the Landlord are also liable to pay a Service Charge towards such expenditure.

And

iii. The total of the amounts paid would be more or less than the whole amount of such expenditure.

2. The ‘Computation of the Service Charge’ therefore relates to the Apportionment Method, which means the way in which the costs of managing a building are divided between the dwellings in that building.

3. For more information about Apportionment Methods read our article entitled Apportionment of Service Charges.

What does this mean for Leaseholders?

1. This is important to Leaseholders because it gives them an opportunity to attempt to address any defects or unfairness in their Lease.

2. It also gives Landlords the opportunity to change the way a Leaseholder’s Service Charges are calculated, and potentially leave with them with additional monies to pay both in the future and for previous years.

How to make an Application to Vary a Lease

1. An Application to Vary a Lease can be made by completing an Application Form and sending it, along with the appropriate Fee, to the First Tier Tribunal. The Application Form can be downloaded at: http://hmctsformfinder.justice.gov.uk/HMCTS/GetForm.do?court_forms_id=3083

2. The current (2014) Fees are on a sliding scale depending on the number of Leases which are to be varied:

£190 – 5 or fewer dwellings

£315 – Between 6 and 10 dwellings

£440 – More than 10 dwellings

3. For Leaseholders wishing to make an Application they should note that the Application must be accompanied by a draft of the variation which they wish to have made. To do this a Leaseholder is likely to require professional legal assistance as the Tribunal may require the draft in the form of the Order which the Tribunal would make in the event that the Application is successful.

Relevant Case Law

See the section of our case law library on Applying to Vary the Terms of a Lease

Click on the link to read more about The Landlord and Tenant Act 1987